In this subtitle the following words have the meanings indicated. “Buyer” means a person who buys consumer goods under a layaway agreement, even though he has entered into one or more renewal, extension, or refund agreements. “Buyer” includes a prospective buyer. “Cash price” means the minimum price for which consumer goods subject to a layaway agreement, or other consumer goods of like kind and quality, may be purchased for cash from the seller by the buyer. “C.O.D. transaction” means an agreement by which the seller requires the buyer to pay the full cash price of the consumer goods upon delivery or tender of delivery by the seller, less any down payment made by the buyer. A C.O.D. transaction does not include an agreement by which the seller requires the buyer to pay interim payments before delivery or tender of delivery of the consumer goods by the seller. “Consumer goods” means goods bought for use primarily for personal, family, or household purposes, as distinguished from industrial, commercial, or agricultural purposes. “Down payment” means all amounts paid in cash, credits, or the agreed value of goods, by or for a buyer and to or for the benefit of the seller at or before execution of a layaway agreement or C.O.D. transaction. “Layaway agreement” means a contract for the retail sale of consumer goods, negotiated or entered into in the State, under which: Part or all of the layaway price is payable in one or more payments subsequent to the making of the layaway agreement; The consumer goods are specific existing consumer goods identified from the seller’s stock or inventory at the time of the making of the layaway agreement; and The seller retains possession of the consumer goods and bears the risk of their loss or damage until the layaway price is paid in full. “Layaway agreement” includes a “special order transaction,” as defined in this section. “Layaway agreement” does not include a bona fide C.O.D. transaction. “Layaway agreement” does not include any form of layaway agreement where the buyer can default without any penalty, other than a maximum service charge of $1. “Layaway price” means the cash price of consumer goods together with an optional service charge, not to exceed $1 if the price of the consumer goods is $500 or less or $5 if the price of the consumer goods exceeds $500. “Retail sale” means the sale of consumer goods for use or consumption by the buyer or for the benefit or satisfaction which the buyer may derive from the use or consumption of the consumer goods by another, but not for resale by the buyer. “Seller” means a person who sells or agrees to sell consumer goods under a layaway agreement. “Special order transaction” means a contract for the retail sale of consumer goods, negotiated or entered into in the State, under which either: Consumer goods: Are ordered by the buyer to the buyer’s unique specifications; Are not carried by the seller, either in the seller’s showroom or warehouse; Are ordered from a manufacturer or supplier; and Are not resalable by the seller at the sale price negotiated with the buyer; or Consumer goods which have been altered at the request of the buyer so that the goods are no longer salable to the general public.

A layaway agreement shall be in writing and contain all of the agreements of the parties and shall be signed by all of the parties to it.

A layaway agreement shall include: The full name, place of residence, and post office address of each party to it; The date when signed by the buyer; A clear description of the consumer goods sold sufficient to identify them readily; The cash price of the consumer goods sold; All charges for delivery, installation, or repair of or other services to the consumer goods which, separate from the cash price, are included in the layaway agreement; The sum of the cash price in item (4) of this subsection and the charges for services in item (5) of this subsection; The amount of the buyer’s down payment, together with: A statement of the respective amounts credited for cash, credits, and the agreed value of any goods traded in; and A description of all goods traded sufficient to identify them; The unpaid balance of the cash price payable by the buyer to the seller, which is the sum specified in item (6) of this subsection less the amount in item (7) of this subsection; The service charge; The total of payments owed by the buyer to the seller, which is the sum of items (8) and (9) of this subsection, the number of installment payments required to pay it, and the amount and time of each payment; The layaway price, which is the sum of items (6) and (9) of this subsection; and A clear and concise statement of all consequences of buyer’s default. Subsection (a)(4) through (12) of this section does not apply to any layaway sale subject to the disclosure provisions of the federal Truth in Lending Act if the seller complies with the applicable disclosure provisions of the federal act and its regulation.

At or before the time the buyer signs a layaway agreement, the seller shall give him an exact copy signed by the seller. Upon execution of a layaway agreement, the seller shall hold for the buyer or agree to deliver to the buyer on a date mutually acceptable to both parties, the consumer goods or consumer goods that are identical to those originally selected by the buyer, as long as the buyer complies with all of the terms of the layaway agreement. The seller shall permit the buyer to cancel a layaway agreement, without any penalty or obligation, within 7 calendar days from the date of the layaway agreement. If the buyer cancels the layaway agreement as provided in paragraph (1) of this subsection, the seller shall: Refund all payments made under the layaway agreement; and Return, in substantially as good condition as when received by the seller, any goods or property traded in. If a payment is made on account of a layaway agreement, the seller shall give the buyer on his request, or, if payment is made in cash, without request, a complete written receipt for the payment; and If the buyer requests information on the status of his account, the seller, within 10 days after the request at the place of business where the layaway sale was made, shall give the buyer a written statement setting forth: The layaway price; The total amount paid by the buyer to date; and The total amount remaining due to the seller. After the buyer has made all payments to the seller in accordance with the layaway agreement, the seller shall deliver to the buyer the consumer goods or consumer goods that are identical to those originally selected by the buyer.

The seller may not increase the layaway price of the consumer goods sold under a layaway agreement. If, within 10 calendar days after the execution of a layaway agreement, the seller reduces the selling price of existing items in his stock or inventory identical to those being held for a buyer, the seller shall credit the buyer for the difference between the original layaway price and the reduced price.

The buyer is in default under a layaway agreement whenever 15 days has lapsed from the scheduled date on which the buyer failed to make a required payment. If the buyer defaults under subsection (a) of this section, the seller may immediately cancel the layaway agreement and recover from the buyer liquidated damages under subsection (c) of this section or § 14–1107 of this subtitle, as applicable. If the buyer defaults under a layaway agreement 8 or more calendar days after the date of its execution, the seller may retain as liquidated damages an amount not to exceed 10 percent of the layaway price or the total amount paid by the buyer to the date of default, whichever is less. Unless otherwise provided in the layaway agreement, subsection (c) of this section does not apply if the buyer defaults under a special order transaction. Except as provided in § 14–1104(c) of this subtitle, at any time before delivery or tender of delivery, and before default by the buyer, the layaway agreement may be canceled by the buyer. However, the seller may retain from the refund due the buyer liquidated damages in an amount which is the lesser of 10 percent of the layaway price or the total amount paid by the buyer to the date of cancellation.

If the buyer defaults under a special order transaction, the seller may exercise all rights and remedies available at either law or equity, including those rights and remedies as provided in the Uniform Commercial Code, Title 2 “Sales,” Subtitle 7 “Remedies,” of this article.

The Retail Installment Sales Act, Title 12, Subtitle 6 of this article, does not apply to any sale of consumer goods regulated by this subtitle.

If the seller fails to comply with § 14-1102, § 14-1103, or § 14-1104 of this subtitle, the buyer, before delivery by the seller and acceptance by the buyer of consumer goods purchased under a layaway agreement, may cancel the layaway agreement and receive from the seller a refund of all payments made under the layaway agreement and the return of any goods or property traded in. Any seller who makes a layaway sale in violation of this subtitle is liable to the buyer for a penalty amount equal to three times the amount paid by the buyer under the layaway agreement, plus reasonable attorney’s fees. Any seller who demonstrates that a violation was nonwillful is not liable for the penalty or attorney’s fees. The penalty provided in this subsection is in addition to that provided in subsection (a) of this section. If the Division of Consumer Protection, Office of the Attorney General has reason to believe that any seller has violated any provision of this subtitle, the Division may institute a proceeding under Title 13 of this article.

This subtitle may be cited as the Maryland Layaway Sales Act.